I think it's time that the government stop using the availability of debt to measure success; I also believe it's time for American's to move away from the 'gotta have it now' mentality- including small business owners and entrepreneur's in the making.
Yes, a business can be started without debt. Yes, it will take longer and grow slower. Yes, you will be better off in the end.
Taking on debt dramatically increases the pressure on a business to succeed. It encourages businesses to grow too fast too soon (What good is a $100,000 in equipment and no customers or filling 2,000 sq ft with inventory there is no demand for?).
I would encourage entrepreneurs to think big but find a reasonable way to get there. Maybe you need to spend a few months working an extra part time job to build up cash reserves before diving into your own business. Maybe you need to start the business 'on the side'.
Most small business owners want to be their own boss, but the second they borrow the become slave to the lender- forced to make sales figures that allow the bank to be paid back, keep the lights on at home and pump money back into the business. This pressure forces poor decisions and makes for desperate owners- and no one wants to do business with a desperate company (except the government it seems).
I hope a discussion can follow about ways to start and grow debt free. I don't think it's unrealistic, do you?
Truely, the range of debt options available to consumers is huge. Debt Settlement and consolidation, refinancing, mortgage and home equity loans, loan modifications - if you are reasonably interested in your financial fututre there is a lot you can do to keep yourself on the right track.
If you have adequate insurance provisions you should also be insulated against some of the major pitfalls that can derail your plans.
Message Edited by ChristineL on 11-24-2009 02:17 PM
Becoming a slave to a bank is a business decision thatismade when the principal decided to sign for the capital. Other alternatives are to sell stock to investors and/or grow your business organically. Being adebt free company can be easy if you're patient and use finances wisely.
There really needs to be a fundamanetal shift in the financial mentalityof people towards more of a spend what you can afford rather than spend to your capacity to borrow.
It's the same around the world unfortunately. In business however access to funds at the right time is critical, so there is a certain level of relaiance on credit that is unavoidable.
Get debt free - 7 Simple Steps towards a tension free life. 1.Lower your monthly payments, 2.Reduce interest rates, 3.Waive late fees, 4. Eliminate collection calls,5. Avoid bankruptcy, 6.Have only one monthly payment & 7.Become debt free
Let's face it, the credit system failed because the borrowers had no real capacity to repay the loans as agreed. This was facilitated by government programs that encouraged lenders to sell loans they knew were no good. This is why most of the bad loans were repackaged and sold off. The correction is taking place right now, but recovery seems very far off as long as the government continues to extend credit to itself.
BF Schild
Stop Ringing Ears
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Message Edited by NicoleD on 01-11-2010 10:21 PM
I think it is easier to get into debt than to get out of it for many people. Nobody wants to go or get into debt, it just happens sometimes. When that happens it can take years to get back out of it. I think everyone would like to be debt free, it just seems like something comes up and your only options sometimes is credit and/or a loan.
dman
I agree with JoeGamer. Excess cash always prompts too much spending - especially when it comes to starting a new business. Debt free small businesses are always the way to go.
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I'm currently a student in Philadelphia who enjoys watching free documentaries online.
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Well I personally have experience scenario that is related to debt.
When I start my Rattan Manufacturing business (Cane Furniture export to Australia). I borrowed close to $35,000 to buy a property where I can build my factory.
In my case this was a good decision even though I will have a huge overhead. Since I already have a solid buyer and some other buyers which show interest in buying my product so salesis more or less assured.
After I did all the math the actual amount I was paying for the loan was not that bad if you compare it to renting a factory.
Even though the first few years was hard and the factory also double as a home to save money on rent.
jamestkirk | Creator | 11/23/2009 - 9:35 pm
Debt | Performer | 12/18/2009 - 5:55 am
mrhelpful | Contributor | 12/18/2009 - 8:37 pm
angeli | Performer | 12/28/2009 - 2:09 pm
NicoleD | Former Moderator | 12/28/2009 - 8:00 pm
bfschild | Window Shopper | 1/9/2010 - 5:23 pm
dman | Performer | 3/23/2010 - 12:03 am
pipp22 | Window Shopper | 7/27/2010 - 10:55 pm
JimD | Former Moderator | 7/28/2010 - 8:03 am
jthorf | Contributor | 7/29/2010 - 10:24 am
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